GOOGLE ANALYTICS

Sunday, March 27, 2016

The global pharma industries who
are into the segment of life saving drug manufacturing are playing the game of
capitalisms and are busy in printing money rather than saving life. Being an
journalist I strongly resist on the issue. Anti-diversion programme this
is the law which is being used by the foreign pharma companies to play with
human life. This law acts in this fashion where the patients will only get the
drug if they can provide identification, proof of citizenship and residency. This will prevent many people from accessing the
drug as well as will create lot of problem for the patients who are busy
focusing on saving their loved ones. Many doctors will shy away from prescribing
and will create more rumors of non availability of the drug. Further drug mafia’s
will get a place to play indirectly as they have unlimited scales to reach anywhere. I find
that this Anti-diversion programme and the pressure on the Indian government
regarding IPR changes are being designed to increase the income inequality among
the Indians. Indians are increasing their wealth and are trying to increase the
GDP growth. In such condition restriction on drugs and medicines will create
massive problem at the ground levels which will lead to further problem for the
people in terms of macro factors. This will lead to widening of income inequality,
more deaths due to non affordability and also insurance companies will find a
substantial hit in the long term. Drugmakers and their lobby group
Pharmaceutical Research and Manufacturers of America (PhRMA) which have made
some of the strongest representations to the US government against India's IPR
regime.

Further its being found that
Indian government is being pressured and also many legal actions are being
floated against the Indian pharma companies so that the Indian IPR act could be
modified and could be modified where they can control the generic drug market.
They want decade of patent orders on their product which are highly priced and
also beyond common man reach. The Indian generic drug segment helps many
Indians to access medicines which becomes to their affordability. This is a
clear study of exploitation of resources in a
country like India where 60% of the population don’t have proper access to
health care facilities. Share holders profits and exponential growth is busy in
changing the landscape of the world. People will die but they will not get medicine
unless they are at the affordable levels hence these Anti-diversion programme
will create massive problems rather than solving. Just imagine that if in case
of polio this law have been adopted then imagine the condition of India and
other countries. Overseas foreign
companies are pressuring the Indian governments to adopt this law and also to
incorporate changes in the IPR act.

I find that Indian population is
being taken as a field of exploitation where in case of health. US have kept India
in high alert place due to IPR since they want changes. The same is applicable
in case of Europe. They want Indian markets to be controlled and make the
income inequality widen among Indians who are working hard to fill up the gap. US
drugmakers have three major problems with India's patent law - Section 3(d) and
Section 84 of the Indian Patents Act, and absence of a period of exclusive
marketing rights when a new drug gets regulatory approval. Under Section 3(d),
new forms of existing medicines can't be patented unless they improve
therapeutic efficacy. Section 84 allows issuing a compulsory licence to meet the
reasonable requirements of the public at a reasonably affordable price. A
compulsory license can also be granted under Section 92 of the Act in case of a
national emergency.

Just like food medicine is a necessity.
Further with increasing pollution and life style diseases have taken new shapes
and dimensions hence the demand for cheap and proper affordable health care is
required globally. Laws like Anti-diversion programme creates end for
the global health care industry to improve. Every pharma companies will try for
become billionaire at the cost of human life. FDI investments are good but not
at the cost of Indian life.

The profession of cost management
has taken many changes over the years and now the current decade and the coming
one are the era of strategic cost management. As I have been writing
exclusively for this segment today I will accentuate on the key areas of
balanced score card. I have already in my previous articles have covered extensively
on balanced score card I find it to be one of the best tools for an organization
to scale into new heights. Every year when the month of March
comes up and annual review is being conducted the most important question being
asked to sales or management team is that how many clients are being acquired. The question should be how many clients acquired
in the last 5 years are still with the organization. This s the place and point
from where a cost accountant and his reports creates a difference in the management
system.

I find that companies
focus on client acquisition and less on customer retention or winning back the
client. Churning of clients has become a key factor. Low churning of clients is a key factor for
the success of an origination which also leads to better balanced score. Competition has lead to high number of
churning and hence strategic cost management is very important for the cost
control and reducing churning of customers. In today’s market we can’t afford to take
double cost hurt while a customer leaves or churns. Even if the companies focus
on customer retention they go on a limited approach as cost is too high in
getting back a client. Now applying strategic cost management I find that cost
accountants can help to create and also design the mix of product for the customer
winning back the customer. Only acquisition of customer will be of no help f there
is a leakage in the system from where customers changes your products and
services. Like a cost accountants who design a sales mix he can design a
product-client winning back based product.

Most
companies incur high cost while winning back clients as they try to establish
the brands again. The company must understand that the client is already aware
about your brand and he has just changed the product or service. Hence, no
requirement of re-establishing the brand to the same client. This saves huge
cost. Now you need to figure out why the client changed the product or service.
If it’s due to price then placing discounts solves the problem. If it’s due to
service then your operation needs a-check up regarding the servicing part. If
the client has moved out due to both then one needs to design a separate product
of service and price combination for the same. The recent technology, particularly
more-sophisticated customer databases, allows companies to draw on information about
how people used their service the first time around to craft more-successful win-back
offers.

For example in case you belong to
an Insurance or telecom industry switching over the client is often and this is
the place where you need to get into price and service part so that the client
comes back to you. You don’t need to incur high cost of brand establishment. A
cost accountant helps to find how much you earned from the client compared to
how many clients you acquired. Revenue per client is an important barometer to
look into success of a product, its life cycle and in making decision regarding
its sales mix and product mix designing. This mix will help the company to cuts
down on churning and improve its services and product prices. Every industries expands and then its falls
back. Its mainly due to the ignorance of
client retention and revenue per client. When an organization focuses on its 5 years
old customers it gets a clear message to the industry and competitors that the organization
is serious about its business, customers, products and services. A cost accountant
helps to design this balance over the years since he knows the various angles
of cost and how the benefit of reduction could enhance the sales. Service cost
also comes down when efficient mix of the same is created.

Defense
spending has become a mass importance to every economy keeping in line with the
growing threat of terrorism attacks. But
defense import is of massive threat standing under the current scenario of the
global economy. Every economy will try to sell his defense equipments but with a
limitation where the buying nation don’t get into more strength. Defense
spending is of great investments for a stable economic growth.

We
all know the story of US economy that spends heavily at the back of defense.
Historically UIS have achieved GDP growth at the cost of defense and war finding
but it also wiped out its Fiscal surplus over the years. The current global economic situation needs investments
and employment across industries. Chinese economy has been going through one of
the tough times and it is aggressively looking forward for reviving the economy
form domestic consumption. I find in my research that defense spending is very
low in china and hence it’s an opportunity for growth for the country. Coming
to US being the No 1 country in defense spending find time has changed that
number and position too. This article focuses on the Chinese economic growth
which it can achieve based on the current position through increasing its defense
budget. But do we know that how much the 2nd largest economy spends at the back
of defense. The surprising part is that it spends less than the average % of the
global defense spending. This is also boon for the economy since the day it
picks up its growth momentum towards defense the whole economy will get a big
jump in its growth.

Being an economic journalist when dig into the facts I find
that it still lags behind major countries in terms of weaponry, training and
payment to its servicemen. Chinese economy have been investing and developing relation
with many economies after the 2008 recession to develop the trade and investments
opportunities. But at home the economy is surrounded by many threats which can
be created into a opportunity by the Chinese economy to grow its GDP beyond 8%
over the next decade. Unless the problems are being identified we will not be
able to measure the depth of the problem being faced by china.

·In the East China Sea, for example, disputes
between China and Japan over the Diaoyu Islands are a matter of tension.

·In the South China Sea U.S. warships
and planes have repeatedly intruded on waters and airspace adjacent to China’s
Nansha Islands.

·China is also under mounting pressure
from North Korea’s nuclear program, as Beijing works toward detente.

·Above all China directly borders 14
countries. Defending its people and territory constitutes an important aspect
of national security.

Hence
china has ample reasons to go ahead for defense spending. Coming to the
economic numbers to get a clear idea about the numeric number of growth china that
china could achieve are as follows:

·The share of its military expenditure
in GDP is only around 1.5 percent, the lowest among the UN Security Council’s
permanent members

·In 2015 China’s average military
spending was equivalent to 1/8th of US and 1/4th of Japan

·In the past 10 years, China’s defense
expenditure averaged 1.33% of its GDP much lower than the 2.6% of the world
average level.

When
I dig further to find out the level where china stands in terms of defense spending
I find some surprising facts for all of you as well as opportunity level for
the china to grow in the long term.

It clearly reflects that china is far behind
other countries and it has ample scope of growth in the long term. The current budget level of china has far long way to go and hence GDP growth of 8% can be achieved.

Sunday, March 20, 2016

In continuation to my previous
two articles related to poverty alleviation and entrepreneurship, I broadly found
in my research that there is deep flaw in the financial institution on policy
frame work. It’s time for applied Management
science followed with Business growth monitoring and assisting for the Micro SME
and SME shifting from the traditional mechanism of credit disbursement growth. Yes
credit growth measurement for business growth is a wrong tool for the society
and its needs modification under these times. Micro SME segment is an important
part to the world economy particularly in times when poverty reduction and
bridging gap of income inequalities comes into play. Credit growth is the key
factor being taken care in financing world where as growth of an Micro SME or
an SME is neglected. Growth of an Micro SME is a key factor for the growth of
an economy. The financial crisis which has started from 2008 has created
immense pressure on the entrepreneurship as they drying out of funds. Financial
crisis have forced many teenagers to drop their schooling become a helping hand
to the family. They are looking or dreaming to start something f their own as employment
market is also down. Large part of the society is under the threat of financial
crisis and this has lead to a significant affect on the Micro SME segment.
Financial crisis has affected CRS activities, have affected NGO’s as they are
getting very low levels of funding as donation and further Banks are reluctant
to spend.

Global entrepreneurship and Micro SME segment
have no other alternative but to look for projects which are based of
capitalism theory where Private investors can be introduced. This kills the
MICRO SME segment. Many entrepreneurs are not getting flourished. Social causes
are being exploited in order to get credit. We don’t need banks we need someone to
understand the viability of an project and also look into the day to day
activity of an Micro SME and SME segment so that their business plans don’t flop
and neither their dreams are shattered. We forget that every death of an dream
cost the economy in terms of multifaceted aspect among them creation of employment
is the biggest. MICRO SME and the journey towards SME is the key area where management
institutes and financial institutes should come together to design and frame
the success of an SME or a Micro SME on an individual basis. This might sound
lunatic but the fact is that we need to form small organization where management
science and financial institutions comes together to develop this success recipe.
The biggest advantage of these bodies
coming together will be that Micro SME will get knowledge and financial strength
together. Well a Private Investor does same thing when he come into play.

My point is that why to go for exploitation
of resources when government should form these organizations to look over the SME
business growth and not on credit growth. The biggest mistake that many
economies have been doing is on the credit growth and not on the proper returns
or outcomes from those credit growths. Looking forward for viable business creation
should be policy of these financial institutions and hence management science
institutes who spend billions at the back of Research and Development should
come ahead with application of the same for the benefit of Micro SME and SME segment.
Lease not that we are no longer in the world where management education results
gets maximum benefit from these new management concepts application.

We need this organization to be
formed under the surveillance of the government so as to keep check on the
future policy frame work which will help the Micro SME to grow business. The government
and the economy both will benefit as they will work on growth of business and
not on credit growth to the Micro SME. Mere disbursement of funds is not sufficient
what is required is bring these MICRO SME entrepreneurs into the growth of the
economy. Disbursement growth of credit and efficient frame work of subsidies will
not help the dreamers to dream big. Private and Government should form these organization
at the zone, district levels so that Micro SME and SME segment is being monitored
for growth. It has been often that they lack strategies for growth which often
leads to close down of business. This leads to loss to the nation through the
banking segment. We don’t need disbursement growth we need growth of employment
through MICRO SME and SME.

Wednesday, March 16, 2016

Poverty alleviation and poverty creation are
going simultaneously as we are not plugging the loopholes as well as not focusing
on transformation phase of the poverty into wealthy segment. In my last article
I focused on entrepreneurship and poverty alleviation. In continuation to that
research I found that the process of butterfly birth is still not well developed
in the entrepreneurship. From the birth
of an Entrepreneurship to a Micro Small & Medium Enterprise to Small &
Medium Enterprise to a listed Small Cap company is not very well processed in
the Indian economy as well as in many economies across the globe. MSME wants to
grow but various types of constraints which make them die in between the
conversion phase into SME.

Strategic innovation, connectivity,
Funding and human labour kills them from taking birth. The government frames
policies and subsidy planning’s but they still fail to blossom out. Few only manage
and rest of them fails. Management science has taken lot of changes but the biggest
lack is the reaching of those changes to the masses and making benefit out of
them. Technology has come to bridge the gap but how many knows or have access
to the same. Micro SME is a game changer for the society since they give motivation
and knowledge to the new comers and plays a pivotal role in poverty alleviation
since they teach the society to dream big.

Just understand that if these
Micro SME are not able to grow then poverty alleviation will remain in nascent
stage. Further, SME’s needs to grow their business into Small companies by
getting listed in stock exchange. People
will say that SME are growing and Micro SME is also growing but what I want to
accentuate is that the growth and conversion phase is very slow. It’s very weak
currently and that’s why poverty alleviation is a slow process. Education and Technical
expertise are weak hence the birth and conversion phase of the butterfly is
slow.

On the other hand natural
disaster and financial crisis is deepening the income inequality phase and
hence poverty is also increasing on the other hand. Taxation benefit and subsidies
are given but reaching them and strategically using them is a cumbersome
process and hardly any management professional will come ahead to support them
since they can’t pay hefty fees. Well the society is divided between knowledge
and lack of knowledge and it’s the responsibility of the knowledge holders to educate
and bridge the gap of poverty. Entrepreneurship promotion within the economy is
not only sufficient to remove poverty but to expedite the process of conversion
into SME and then into a listed company is of greater importance as it creates more
larger environment for recruitment of manpower and other related parties.

If an entrepreneur remains only
Micro SME then he will never create larger growth for employments and other
related parties hence the growth of the poverty alleviation remains a
struggling point for everyone. Strategic policy implementation is required in
every step to build the butterfly birth process to be faster. Now management science
and few professional can create a immense difference behind these Micro SME to
get into the journey of butterfly. Cost Management and cost accountants can
help to create the difference since strategic cost management plays a pivotal role
to develop a true organization which leads to the final destination of an SME
getting listed on a stock exchange. Mere policy and subsidies will not be sufficient
enough to alleviate poverty from the society. Rather we need to get into the
conversion frame work where organization and professional bodies should come
together to help them grow their business and become a beautiful butterfly. It
has been witnessed these MICRO SME struggle with the biggest problem of lack of
growth concepts and also lack mental support. Professionals like cost
accountants can be a bigger influencer for this MICRO SME to a Small Cap company
getting listed. Poverty alleviation cannot be done mere through grants and subsidies.

Sunday, March 6, 2016

There are many subjects which are
floating in front of the economist eyes and we are getting confused regarding which
one to be analyzed and to what extent. I have tried to present a gamut of the
same. I have just picked two economic measures of policies being adopted by the
two different economies and their long term and futuristic movements. I have also tried to present Entrepreneurship=
Poverty Alleviation theory in a simple way. The hunger for consumption eats the
long term behavior of the society. We have witnessed historically that how exploitation
of an asset class leads to a worldwide recession. We all want short term growth
and that is killing the long term base of the economy. Recent move of negative
interest rates and more negative interest rates to be included in the various
countries is being motivated to drive consumption and where people will save
less and will be compelled to spend. This is the economy policy which is being
adopted to get inflation and manufacturing to continue its upward journey and
deny people from savings. If a economy don’t have much savings and in between a
natural calamity hits the ground then just imagine the depth of the income inequality
and society imbalance being created. We are forcing people to become poorer and
asking the rich to become richest. My concern is that Negative interest rates
will hurt the long term pension funds and the old aged people who will get
added over the next 10 to 15 years.

China and the world commodity
market of iron ore will find its price climbing further and by 2017 and 2018 it
will be better year for the commodity. Few of the rationales would make the
story very clear. Developed economies have shut down the steel and iron ore
production capacities due to the pressure of supply from China. Now all the
worst part of excess production has been curtailed. Further China in its recent
policy has said that it will cut down its excess capacity. This will help
developed economies to grow their business in mining and steel production. But
at the same time the pains of over exploitation of resources will burn many
Chinese citizens. The shorter Boom and the Long Term Burst comes into play for
the economy. Around 1.3 million Jobs will be lost in coal sector, 500000 jobs
in steel industry and another million in mining. Hence slowdown of the economy
in china in terms of consumption is bound to happen. Hence savings is important
for the rainy days for the citizens where as others will find paths to get
consumption growth. During the short term time frame Chinese government did not
went for cut down in its production and when the global economy is struggling at
that point of time these measures are being implemented. Taxpayer’s funds are
also being doled out to save the mass by providing unemployment benefits. Amount
of $15.3 billion will be spent for the next 2 years for the unemployed segment
coming out from all these policy actions. The point of discussion is that aren’t
we being fooled that short term growth and happy spending and then cut down on
production leading to unemployment and increase of social benefits and then
again negative interest rates to get consumption back and ask people not to
save.

We need consumption to be alive.
We need short term profits at the cost of long term and now at the cost of
social benefits. We are not focusing on poverty reduction measures and policies
and their real time implementations. If we look into the formula “Entrepreneurship=
Poverty reduction” then we can get lot of macroeconomic support which will get
growth for the overall economy in the long term. We are looking for options of
bailout and bond purchase and then again default of bonds. We need poverty alleviation policies which
will bring circulation of capital and formation of assets, employments for the
economy in the long term. The government
will be able to get revenues but they will get consumption also as more Small
and Medium Enterprise opens up. The problem is allocation of resources which
the government is not doing properly and has kept it reserved in the hands of
few capitalist. For example a SME born in Europe can design an online platform to
supply goods from NGO’s to China or to Africa where the people are in the poverty
zones. For example in China many villages don’t have proper cinema halls to
watch movies. Hence many people can come together to develop some business
where these people can watch cinemas.
Advanced agricultural information and production knowhow could be shared
for improving the crop cultivation in remote villages where people are in the
poverty lines and bringing growth for them. Advanced quality fertilizers and
seeds could be transported to develop these places. Well the world has
abundance level of poverty and we are doing only meagre things to bring growth. Alleviation of poverty can make enough gross capital
formation and also investment climate. Now a question might come up that this
is an easy subject to know but then why it is not being implemented. Well we
all need exponential growth and within very short span of time. This mindset have killed all the growth
opportunities and now we are struggling to get inflation and consumption back.

About Me

I am a economic,financial writer and research analyst. I am an Economist |Editor | Author | Columnist | Speaker|Strategist|. Digging out facts and making indepth analysis of financial matters is my life work.I love discussing and making financial strategies to meet the financial objectives of the life.At the same time I am an avid reader. Books are my passion. No matter how busy I am, I always manage to find time for reading. I also enjoy cooking good food, Hindi music & a good cup of coffee.One of my personal traits I am most proud of is being creative and artistic.

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